North Carolina Senate Republicans Propose Doubling Sports Betting Tax To 36%

North Carolina Senate Republicans proposed doubling the state’s sports betting tax to 36% as part of their $66 billion biennial budget released Monday.

The Tar Heel State launched sports betting in March 2024 and quickly emerged as a top-10 state in terms of monthly handle. The $685 million in accepted bets reported last month is an all-time high.

The first 12 months of betting generated $6.6 billion worth of wagers, and sportsbooks reaped $713.8 million in revenue. In turn, North Carolina’s tax coffers saw an inflow of nearly $50 million in receipts from the current 18% levy, and that does not include license fees paid to the state.

Sportsbooks in North Carolina cannot deduct promotional spend from their gross revenue. That outlay totaled $491.7 million in the first 12 months of wagering, but more than $202 million of that came during its well-timed launch in which North Carolina State’s men’s and women’s basketball teams reached the Final Four.

If SB 257 is passed — Republicans have a sizable majority in both chambers but lack a three-fifths majority in the House to override any potential veto by Democrat Gov. Josh Stein — North Carolina would have the third-highest tax rate among states with commercial sports betting not run by single-operator entities when it takes effect Oct. 1.

New York has the highest tax rate at 51%. Illinois’ progressive rates have a top tier of 40%. North Carolina would then slot ahead of Pennsylvania, which collects 34% of operator revenue at the state level.

Following the trend

North Carolina lawmakers appear to be trying to ride a nationwide trend of states looking to attempt to raise sports betting tax rates. Maryland may be closest in terms of an actual increase as Gov. Wes Moore’s proposed budget would raise the rate from 15% to 20% — less than his initial ask of 30%.

New Jersey Gov. Phil Murphy requested raising the mobile sports betting tax from 13% to 25% as part of his final budget in office. Legislature still in committee in the Indiana Senate has proposed a modest raise from 9.5% to 11%, and Massachusetts Sen. John Keenan proposed more than doubling the Bay State’s rate to match New York at 51%.

Ohio Gov. Mike DeWine proposed a second doubling of the Buckeye State’s tax rate to 40% — he doubled the rate from 10% to 20% in 2023 — but that was stripped from the budget proposal by House lawmakers from his own party.

Nationwide, sports wagering has already generated close to $700 million in state tax revenue in the 2025 calendar year, with North Carolina accounting for $30.3 million.